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With the high prices around the old town, stimulated especially by forthcoming high profile developments just south along the river, developers have focused their attention on established residential neighbourhoods with existing amenities and infrastructure or, with big business from corporates in mind, areas near road or rail links for access out of Slovakia or to the upcoming business parks.
For an investor, it is on the edges of the ‘ripple’ effect of these construction patterns where there is most opportunity for getting the best deals, as this is where there is most interest from Slovak buyers priced out from areas closer to the old town or centre. There is also interest from the growing foreign professional market moving in with corporate business, and also for Slovaks who have been resident before or grown up in these residential areas and want to stay close to their communities. Most
importantly from an investment point of view, this activity reflects strong rental as well as resale demand, a balance which becomes very one-sided the closer you move toward the old town as increasingly high prices have eaten away at yields.
More interest means more competition among developers to capture this market, and therefore more opportunity to get the right property at the right price on the right terms. This is the background behind our investment opportunity at the KV2 development in Dlhe Diely, Bratislava.� This IPEC development comprises two south-facing residential high-rises, with the first block (KV2B) already completed and occupied by Slovaks, and the current block (KV2A) commencing construction in the next month. The high standard of finish and rental level of the first block gives an indication of what we can expect on completion for the second block. Being able to see the community in action‚ as it were, with lower floors on both towers having been developed for commercial space with fitness centres, retail & bank outlets etc, lends a great deal of confidence to the growth of this area in Dlhe Diely.
With a comparable price per square meter that is simply the best in the market for its build and location in Bratislava, the KV2A development in Dlhe Diely should prove to be a superb rental investment delivering excellent capital growth to our investors. In-fact, we believe that at the price level our investors are buying in at, and the fact that we have first choice of apartments, there is an element of built in equity from day one!
The Location � Dlhe Diely is a residential zone that sits between the established area of Karlova Ves to the east in the direction of the old town, and Devin to the west, site of the famous Devin castle and a more upmarket and exclusive neighbourhood. The area enjoys its own cinemas, banks, shops and restaurants, all within walking distance from this IPEC development, as well as a key advantage of being, along with Karlovo-Ves, ideally placed for access to the two international schools in west Bratislava and the roads toward the old town and Vienna and Prague highways.� The IPEC Group is a large award-winning Austrian construction company operating through central and eastern Europe since 1993, with a main focus on commercial projects and consultancy for businesses moving into the emerging European markets. They are a mainstay on the business circuit and have built a reputation on their commercial developments for companies such as Mercedes Benz, Ford, Invesys and Vaillant. Click here to go the IPEC website
As a quick aside, IPEC is also one of the key players in the growing partnerships between Vienna and Bratislava, the two closest capitals on earth. The relationship between these capitals has been one of the forces behind Bratislava’s exceptional growth to date, and will continue to be a fundamental driver in Bratislava’s growing position as a centre for business in the heart of Europe. Their recent piece on the ties between the two capitals makes interesting reading: download the article.
The interesting fact about IPEC is that their partnerships with big business through their commercial projects give them a high amount of visibility as to where the opportunities for residential development lie. It is no surprise, then, that the IPEC development is in the most ideal location we’ve seen in Dlhe Diely, on top of the hill with views to Austria, the Danube and Bratislava centre and with access to the main roads and international schools nearby.
Slovak Investments' Terms
One of the reasons we usually only market a handful of units with any development is to keep a sustainable ratio of investors and local buyers to optimize the investment and also, quite simply, because we only market the best units in any given development. We will sell a limited number of units to investors, and on a first come first served basis.
We have succeeded in negotiating terms with IPEC that provide an exclusivity period for our investors to choose any unit in the development, giving more flexibility for choice, especially among the higher floors with river views over to Austria.
Pricing and Comparables
All the above would have been worth very little if we felt this development was at a price comparable to the market that made it a speculation and not an investment. However the prices at KV2 Dlhe Diely, considering the spec of the development there to see in the already completed tower, its location and our terms of unit selection, puts it head above shoulders against any comparable current development on the market in Bratislava.
Units prices start at 42,000 SKK per square meter and average less than 50,000 SKK per square meter – always the rule when running comparables rather than looking at the total apartment cost. This is lower than similar developments currently marketed in Dubravka, an area further out than Dlhe Diely, better value than the large Skanska development 10km further down the river in Devin and certainly far more affordable than one particular development 1 km away selling at over 70,000 SKK per square meter. The first Tower (KV2B) sold three years ago to Slovaks at an average price level of around 33,000 SKK/m2 and since then Dlhe Diely has become an increasingly popular residential area.
The prices at IPEC's KV2 tower in Dlhe Diely are excellent for this location and build.�
Rental Considerations
We have been given examples of two bedroom apartments in the first tower (KV2B) renting out for between 750EUR - 800EUR + services per month and the agents we have spoken with have confirmed this level.
Transport and Distances - Nearest Bus stop: 50m
- Bratislava City Centre: 5 km
- Presidential Palace: 5 km
- Old Town: 4 km
- Main Highway to Vienna and Prague: 2 km �
We have negotiated a six week exclusivity period whereby our investors can choose apartments before the developer starts marketing locally.
Other considerations and Costs
In Slovakia fitted kitchens are not generally included in new developments and you should expect to pay approximately €4000 for a good quality kitchen including all white goods. Slovak Investments can recommend appropriate kitchens and kitchen companies to you closer to the time of completion.
Secure underground garages are already allocated for each apartment and prices range from 230 000 - 280 000 SKK + VAT depending on apartment and floor. Garages are not included in the apartment price.
Amenities & Warranty
• Passenger lifts to all floors including underground parking
• Controlled access to underground parking
• Storage space
• All apartments benefit from a 2 year builders warranty
Specifications
• Walls: concrete construction, isolated facade
• Windows: plastic and aluminium
• Entrance doors: wooden safety doors
• Interior doors: wooden
• Floor: kitchen, toilet, hall, bathroom – tiled
• Rooms: laminated parquet
• Heating: central heating system in the house
• Garage doors: Electric
• Stairways: terrazzo
• Exterior banister: concrete construction, isolated facade
• Bathroom: Fully fitted including sink, taps etc
The Buying Process Buying in Slovakia as a foreigner is a relatively straightforward process and we have lined up all the relevant parties to make the process as smooth as possible for you. Unlike most Slovak new development payment plans, we have managed to negotiate for our investors only 30% now, and 70% on completion (which will be covered by your mortgage).
How to Reserve
When you are ready to reserve your unit Contact Us with your preferred unit details and we will respond with a reservation form if that unit is still available.
You will have 7 days to get your reservation money (100 000SKK) to the developer's account. After the developer is granted full permission to build (by December 2006), the developer will sign and send the contacts to you. From then you will have 21 days to sign the preliminary contract during which time your solicitor will translate and check through your contract to make sure all is in order and the terms are good. We will also put you in touch with our recommended mortgage broker who can obtain a mortgage pre-approval based on your creditworthiness.
Should the developer not obtain permission by January 31 2007, they will refund the reservation fee in full.
Exchange of Contracts
Once your solicitor is satisfied with the contract, you or your power of attorney will sign it (within 21 days of reservation) and you will then have 14 days to pay your deposit of 30%. Your arrangement fee of 2%+VAT to Slovak Investments will also be payable at this time.
Payments Plan
30%: Within 14 days of signing the contract
70% at completion (approx. 2 years)
Completion Upon completion, the final contract is signed and the property ownership is transferred to you and registered in your name.
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Solicitors in Bratislava, Slovakia :
Tax advice Slovakia : New apartments Bratislava : Slovakia Market Information : Property in Slovakia : Bratislava Property Information
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